CBC News – Consumers, businesses scramble to beat HST – #Toronto #economy #realestate #business

Consumers, businesses scramble to beat HST

New taxes on many goods and services from funeral plots to spa treatments

Last Updated: Thursday, June 17, 2010 | 4:29 PM ET Comments30Recommend12

Thousands of people line all five levels of Toronto's Eaton Centre. When the harmonized sales tax takes effect in B.C., and Ontario in July 1, consumers will pay an extra seven per cent and eight per cent, respectively, for services from home renovations to haircuts. Thousands of people line all five levels of Toronto’s Eaton Centre. When the harmonized sales tax takes effect in B.C., and Ontario in July 1, consumers will pay an extra seven per cent and eight per cent, respectively, for services from home renovations to haircuts. (Darren Calabrese/Canadian Press)Consumers are scrambling to close deals with just two weeks left before the Harmonized Sales Tax is introduced in Ontario and B.C.

Business has nearly doubled in recent months at Valley View Memorial Gardens in Surrey, B.C., as thrifty planners move to lock in funeral pre-arrangements before taxes — life’s other famed inevitability — take a new toll on the costs of their final plans.

“There’s wisdom in pre-arrangement and there’s wisdom in not paying taxes,” said Ron Laturnus, manager of the cemetery.

“Everyone will have to face the problem of purchasing their cemetery and funeral arrangements some day. Everybody. Unfortunately, none of us are exempt from this problem,” he added.

Like many services in B.C. and Ontario, cemetery, cremation and funeral arrangements have been exempt from provincial sales taxes. But when the Harmonized Sales Tax takes effect in those provinces July 1, consumers will pay an extra seven per cent and eight per cent, respectively, for services from home renovations to haircuts.

When the HST comes to B.C. and Ontario on July 1, consumers will pay more for many things including funeral plots and landscaping.When the HST comes to B.C. and Ontario on July 1, consumers will pay more for many things including funeral plots and landscaping. (iStock)Laturnus said he’s seen a significant increase in business since the beginning of the year, and believes the HST is the reason.

While the world of tax policy can be confusing, a good rule of thumb to follow is that if it’s not GST taxable now, you won’t pay HST on it later.

Basics, such as groceries, most health and education services, prescription drugs and child care, will not be subject to the HST. There are also some exemptions specific to each province. In B.C., gasoline will be exempt, while Ontario consumers won’t be dinged for meals under $4.

Many services, including housekeeping, spas and landscaping services, have ongoing “beat the HST” promotions — but it’s important to be vigilant about online promises because the deadline for prepayment on most services and items delivered after July 1 passed at the beginning of May.

HST already on purchases used after July 1

It’s too late to beat the HST on most big ticket items — gym memberships, theatre packages and airplane tickets — that will be used after the tax is implemented.

Spa treatments and other relaxing pastimes such as golf or a ball game will cost more under the HST.Spa treatments and other relaxing pastimes such as golf or a ball game will cost more under the HST. (iStock)But with two weeks until the tax is added to services and other items, there’s still a narrow window of opportunity to take in the dry cleaning, get the cracked windshield fixed and replace that outdated smoke detector before they are slapped with the new tax.

After a day of errands, indulge in some savvy pampering — going to the spa, a day of golf, a ball game, or a night at a hotel — because all of those services will cost more next month as well.

And while both provincial governments say consumers will see no change to taxes on about 80 per cent of purchases, some small frills such as vitamins, camp sites and taxis are going to cost more.

Diners in B.C. will pay more next month for restaurant meals, which had been PST exempt in the province.

Allison Wallace of Flight Centre Canada said last minute vacationers can beat the HST by bumping their travel dates ahead of July 1.

She added that the travel agency has received more inquiries over the same month last year, but there hasn’t yet been a significant increase in bookings, meaning it’s likely last-minute travellers can still find room on a flight.

HST has also been a factor in driving homebuyers to market before the tax hits a variety of services associated with home purchases, including real estate commissions (and legal fees, which were exempt in Ontario). And there’s still time to close a deal and settle up with the realtor before July 1.

Other small businesses are finding ways to keep customers even after the HST hits.

George Urvari, president of Oriole Landscaping, said many customers have been moving up yard work to beat the HST. Others are looking for ways to avoid paying it even after July 1.

Urvari said its hard to tell whether business will keep booming after the HST hits, but doesn’t want to take the risk in fragile economic times.

He said he’s conceded to customers asking for ways to escape the HST in order to keep their business and to do so, he’ll discount services for insistent customers and his small landscaping business will take the eight per cent hit to revenues to keep both customers and the tax man happy.

© The Canadian Press, 2010
via cbc.ca

Posted via web from Toronto Real Estate News, Blog

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About Tariq Sultan
Dear Readers, I am a dedicated Toronto, Ontario based real estate professional who has been successfully meeting and exceeding the needs of his clients for past several years. I am actively involved in the insurance, financing, and mortgage industry. Real estate is not only my career – it is my passion. I strive to continuously provide my clients with exceptional service to ensure they are fully satisfied when it comes to their real estate needs. For any real estate related inquires contact me today, I will be happy to assist you. Best wishes, Tariq Sultan

One Response to CBC News – Consumers, businesses scramble to beat HST – #Toronto #economy #realestate #business

  1. ChaiYOo says:

    HiCare Beauty & Spa, a new Spa business is where partners do not have to pay the right franchise lifetime low investment, high margin investments one can make money for the duration of the business.New form of investing is not difficult once people do not use much guarantee payback in 3-6 months.

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